Unemployment rates rise in U.S. election swing states

Lisa Lambert

Washington (Reuters) - Unemployment rates rose in July from June in almost all states, including those where the presidential election fight is expected to be fiercest, according to data released on Friday by the Labor Department.

Altogether, jobless rates rose in 44 states. Rates dropped in Idaho, Rhode Island and the District of Columbia, and were unchanged in four states.

As the country moves closer to November's election day, voters' attention is squarely focused on the economy and a national jobless rate hovering above 8 percent.

Because of the unique U.S. political system in which states cast electoral votes for president, the contest between President Barack Obama and presumptive Republican nominee Mitt Romney is heating up in seven states where polling suggests voters are undecided.

In those states - Nevada, Florida, Colorado, Wisconsin, Ohio, Virginia and Iowa - jobless rates all rose or were flat in July. Nevada again had the highest rate in the nation at 12 percent, while Florida's 8.8 percent and Colorado's 8.3 percent were both at or above the July national rate of 8.3 percent.

In addition to being a perennial battleground state, Florida this year is home to the Republican convention where Romney will officially become the party's candidate.

Obama has been in office since the recession ended in mid-2009, and many consider the election a referendum on his performance on the economy. A majority of Americans view the economy as the most important issue facing the country, according to a recent Reuters/Ipsos poll.

Romney has hammered Obama about employment conditions. A recent Gallup poll found that 37 percent of Americans approve of Obama's job creation efforts, compared with 40 percent in February.

One of the victories Obama touts is the turnaround in Michigan, a state whose fortunes are tied closely to the automobile industry. In the 2008 election, Michigan consistently held the highest jobless rate in the country. Obama pushed through a bailout package for the auto industry during the height of the financial crisis.

Still, Michigan is considered a battleground state that is only leaning toward Obama. In July, its jobless rate shot up to 9 percent from 8.6 percent in June.

Iowa is considered a toss-up between Obama and Romney, and the president recently made a three-day visit there trying to energize the independents and Republicans he won over in 2008. Although the state's jobless rate remains low, it increased to 5.3 percent from 5.1 percent last month.

In North Carolina, the rate rose to 9.6 percent in July from 9.4 percent. The Democrats will hold their national convention to rally around Obama next month in the swing state, which is expected to go to Romney.

July's rate was 8.3 percent in Arizona, 8.2 percent in Indiana and 7.2 percent in Missouri - also all battlegrounds expected to vote for Romney.

NO RUSH BACK TO WORK

Unemployment rates can rise because more people, encouraged by glimmers of an improving economy, re-enter the workforce. That type of hope, though, was not apparent in most of the states, said Philippa Dunne and Doug Henwood, editors of The Liscio Report, an economic newsletter.

"Of those states reporting statistically significant increases, only four - Alabama, Georgia, Nevada and Pennsylvania - reported increases in their labor forces, which can mean job-seekers were more hopeful about their prospects," they said.

"In the big states of Florida, Indiana, Michigan, Virginia and Wisconsin, labor force contraction was accompanied by increases in the number of unemployed, so those increases were of the nasty kind."

Still, for most states, jobless rates are following a downward line. Compared with a year ago, unemployment rates dropped in 44 states and the District of Columbia, and rose in four.

Nonfarm payroll employment grew in 31 states in July and shrank in 19, the Labor Department said. California added the most jobs, at 25,200, followed by Michigan at 21,800, and Virginia at 21,300. New Jersey lost the most jobs at 12,000, followed by Missouri at 7,700, and Illinois at 7,100.